House panel slashes IRS budget to lowest level in 5 years

Jun. 19, 2014 - 06:00AM
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The IRS could see a sharp budget drop under a bill passed by a House panel. (Mark Wilson/ / Getty Images)

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The IRS budget would be slashed to its lowest levels in more than 5 years, under legislation passed by the House Appropriations subcommittee on financial services June 17.

The bill would cut the IRS budget by $341 million — to $10.95 billion for fiscal 2015 — and about $1.5 billion below President Obama’s request. The IRS has seen its budget cut several times over the last few years.

“This funding level is sufficient for the IRS to perform its core duties, including taxpayer services and the proper collection of funds, but will require the agency to streamline and make better use of its budget,” the subcommittee wrote in a statement after passing the bill.

The legislation would also prohibit bonuses or awards for employees identified with conduct issues or who have fallen behind on their taxes. The agency would also be unable to use funds to produce “inappropriate videos and conferences.”

The IRS spent $4.1 million on a 2010 conference in Anaheim, California and spent at least $50,000 to produce a Star Trek parody video.

Colleen Kelley, the president of the National Treasury Employees Union, which represents IRS workers, said she was disappointed by the bill.

“Millions of individual taxpayers and businesses will bear the brunt of the severe impacts of these cuts for an agency which already has lost 10,000 employees from reduced funding over the past four years,” she said.

She said because of funding cuts more taxpayer phone calls will go unanswered, wait times for tax help will go up and in-person filing assistance for elderly and low-income people will be cut even further.

“It should be obvious to every member of Congress that slashing the budget and reducing staffing at the agency responsible for collecting 93 percent of government revenue is not only counterproductive, it is a danger to the effective functioning of our voluntary tax compliance system,” she said.